Farmer’s Markets: Fresh-From-The-Farm

screen-shot-2016-10-26-at-9-40-52-pmNo longer a Sunday pastime, farmer’s markets are a consumer mainstay and retailer favorite. But how viable are they? In this edition of PLMALive! Len Lewis reports on the pros and cons of fresh-from-the-farm.

Farmer’s Markets 

For years, farmers markets were places for a leisurely stroll on a Sunday morning in the country.

But as consumers and professional chefs look for a wider variety of fresher, and sometimes less expensive products, the farmer’s market has become part of mainstream urban retailing, in demand by high-end real estate developers and sometimes invited to share space at or near local supermarkets.

Reflecting this trend, some supermarkets like Wegmans, Kroger, HEB, Whole Foods and many ethnic supermarkets are turning their produce departments into mini farmers markets to attract customers.

This also increases opportunities to sell a wider variety of private label products to go along with fresh produce.

Overall, the number of farmers markets has doubled since 2004, totaling about 8,500 across the country, according to the U.S. Department of Agriculture. However, that number could be far higher since many local markets are either not registered or only pop up seasonally in areas like the Northeast.

Their growth has slowed dramatically—about 1.5 percent annually, according to the USDA. And some observers question whether the concept is reaching a saturation point—particularly in Los Angeles County, which has been on the cutting edge of the farmers market movement.

But the success of these venues is not solely based on food. They have entertainment value and are often the center of the community, creating an opportunity for people to interact with each other and vendors—something they don’t have an opportunity to do online or even in supermarkets.

As such, they are getting significant support from municipal governments and even from supermarkets like Whole Foods, which has organized and managed farmers markets—viewing them as complementary rather than as a direct competitor.

That’s why some developers are creating spaces to accommodate farmer’s markets in open air, town center style projects.

Also, markets in densely populated areas like New York, Chicago and Oklahoma City, are drawing large crowds—as many as 1,000 people per hour from all age, income and ethnic groups.

As a result, research has shown that stores other than supermarkets that are located around farmer’s markets can show a bump of 30 to 90 percent in sales.

But farmers markets can also have a high failure rate.

About 24% close within the first year of operations. In fact, a seven-year study by Oregon State University found that of 62 farmers markets opened, 32 closed.

This is due to lack of interest by vendors and consumers who don’t find the variety they want or feel these markets are just another retailer that caters to higher income customers.

Additionally, farms are discovering that being face-to-face with consumers is simply not as cost effective as distributing products to wholesalers, restaurants and supermarkets.

So, the question is whether farmers markets will remain a trend in the fresh food firmament or have they reached a plateau?



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